Argentina's lower house of Congress on Wednesday gave President Javier Milei's government the green light to reach a new loan agreement with the International Monetary Fund.
Milei asked lawmakers to approve a new 10-year loan, on top of the US$44-billion Argentina already borrowed in 2018, to boost the Central Bank's foreign currency reserves and cover looming debt payments.
The amount of the prospective loan has not yet been disclosed, although Argentina will have a grace period for repayments of four-and-a-half years.
Milei celebrated the result of the vote in a post on the X social network, posting his traditional phrase: "Viva la libertad carajo!"
In a later statement, he hailed the vote as a "message of maturity and greatness."
Under a 2021 law, Argentina's president must seek authorisation from both chambers of the legislature to sign agreements with the IMF, but only needs support from one to be allowed to proceed via decree.
With 129 votes in favour to 108 against and six abstentions in the lower house Chamber of Deputies, Milei now has a free hand to finalise the agreement.
The initiative was supported by Milei's La Libertad Avanza party, the right-wing PRO party, the centrist Unión Cívica Radical (UCR) and Cívica Coalición and lawmakers from the Innovación Federal, Producción y Trabajo and half of the Encuentro Federal caucuses.
The vote took place as thousands of protesters gathered near Congress to protest falling pension payments, Milei's austerity measures and his negotiations with the IMF.
The demonstration was bigger than protests last week that left 45 people injured but appeared more peaceful.
Milei, who has slashed state spending since becoming president, says the new loan will allow the government to pay off its debts to the Central Bank, which in turn would help fight inflation.
The government needs fresh funds from the multilateral lender to strengthen reserves and reassure markets.
Over the last four working days, the Central Bank has sold US$932 million to prop up the peso – 3.4 percent of the BCRA's reserves.
“The agreement is an instrument that will allow us to give sustainability to the stabilisation plan, reducing exchange restrictions, decreasing inflation and returning to the path of development,” said Mercedes Llano, deputy for the ruling La Libertad Avanza party, during the lower house debate.
Opposition deputy Daniel Arroyo countered that “you have to have a lot of faith – you have to be a believer to believe that [the IMF's dollars] are not going to flee."
Argentina has one of the highest inflation rates in the world. But since Milei took office in December 2023, price rises have slowed and consumption has fallen.
– TIMES/AFP
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